There are hundreds of ways to make passive income online. But some prefer creating actual brick-and-mortar passive income businesses. Such passive income streams generally do require a higher financial investment, however, can yield excellent returns.
How can a business make passive income? A business can make passive income if set up to be passive, and not active. This can require time, a financial investment, automation and delegation. Some businesses that can be run passively include ATM machines, laundromats, food trucks, vending machines, self-service storages and automatic carwashes.
In this article, we will uncover passive income business ideas, that, if built to be passive, can provide incredible passive income streams. You will need capital to start most of them so check out our other passive income ideas if you have no money to invest.
For more details about each specific idea, you can learn more in each particular guide on our blog by clicking on the link to the guides on our site that contain more information about each passive income business idea. Let’s get started
You can earn passive income by buying and running an ATM machine. The ATM business has been growing since 2008 with national average fees reaching $4.35 in the US in 2014 (source). ATM fees are split amongst parties (ATM owner, venue owner, and ATM processor). All you need is an ATM machine, a venue with high traffic, and a reliable ATM processing service provider to get started. The ATM processor (the company that handles paperwork and processing) shares out the fees at an agreed ratio). According to Caremon Kong from Forbes, the processor earns a percentage of the fee or $0.10 to $0.50 per transaction (source). A venue owner earns about $0.50 per transaction and then you (ATM owner) receive the remaining balance.
How much passive income can you make from an ATM Machine? Location is (almost) everything. But, ATM customers withdraw $60 (on average) per transaction (source). If your ATM machine has 8-10 transactions every day, this could mean up to $600 is withdrawn daily, and the ATM owner would make $24. Assuming you collect ($3 as ATM fees per transaction) and pay the processor ($1.80 per transaction) and venue owner ($0.50 per transaction). The total transaction fees come to about $4 making your gross profit ($24-$4) = $20/daily. You generate $600 monthly and $7,200 annually. Although the idea may require a lot of capital to start (source), it offers a good return on investment (ROI) for little work.
2. Flipping Cars
If you are a car fanatic, this might be the idea you are looking for. You can make thousands of dollars passively every month by flipping cars. You earn passive income by buying cheap cars and selling them at a higher price. All you need is capital to buy your first car, a laptop, an internet connection, and a license. To make passive income flipping cars, ensure you look for fast-selling models in the best condition possible. Take HD pictures of the car and post them on car selling websites at a higher price.
How much passive income can you make from Flipping Cars? Depending on the number of cars you sell and the clients you have, you can earn $3,000. Assuming you buy a $500 car in excellent condition and sell it for $1,500 – you make $1,000 from one car! If you sell only 3 cars in a month, you rake in $3000 passive income. To maintain a good passive income stream by flipping cars, ensure you look for fast-reselling models, vehicles in the best condition possible, and maintain car-selling ethics to provide yourself good referrals. If you want to make this business passive, you will have to hire someone to outsource the work.
3. Self/Automatic Service Carwash
You can earn passive income by setting up an in-bay automatic car wash. Self-service car washes don’t require you to actually wash cars since the entire process is automated. The client drives through the cleaning booth, gets their car washed, and drives away. An automated car wash business requires a lot in terms of investment and commitment in the initial stages. But when the business begins to run, ROI can be excellent depending on location and seasonality.
How much passive income can you make from Automated Car Washes? You have to undertake many steps to start and run a successful car wash and your location is one of the most important aspects. So long as you are located in a busy spot and offer quality cleaning services, this business makes an impressive passive income stream. Although the initial stages are demanding and challenging, a well-run automated car wash business can earn you up to 900K/year (source).
4. Selling Ice-Cream
People love ice cream and unbelievably, there’s a lot of passive income you can make from an ice cream selling business. All you need is an ice cream truck; a driver, delicious ice cream flavors & treats and you can make thousands of dollars monthly in passive income. Watch out for seasonality as this passive income stream may not bring in much money in colder seasons if you are located in a country with harsher Winters.
How much passive income can you make from Selling Ice-Cream? You can make over $1000 monthly as passive income off an ice cream truck business. Everything depends on your location, your ice cream varieties, service quality and your customer base. There are many ice cream companies and vendors so you have to consider these factors before getting into the business. Seasonality may also be an issue. This idea requires a considerable amount of capital (for the truck, equipment, and ice cream flavors) and higher levels of commitment to start. After you establish a well-run ice cream business, you can earn passive income from it while if you hire someone to do the selling and to take care of inventory. Ice cream trucks gross an average of $15K-30K annually making it a profitable passive income stream for beginners (source).
Automated laundromat’s are an awesome passive income business that is not seasonal. No matter what time of year, people will always need to wash their laundry. However, this passive income idea does require a lot of upfront capital to setup shop locally, and to stock reliable coin-operated laundry machines. However, if setup correctly, you can earn decent passive income from this type of business. The machines do the work for you.
You may need to hire someone to open and close the place, unless you want it to be open 24/7, in which case security will be an important factor to take into consideration. You could setup security cameras that you have remote access to and have a cleaning company report back to you after cleaning the place to make it as passive as possible. In the US, laundry facilities and dry-cleaning services market valuation stood at a whopping $10.2 billion in 2016, making it a viable passive income business idea (source).
How much passive income can you make from a Laundromat Business? Depending on the size of the business and number of clients you serve, a well-run Laundromat can earn you $30K to $1million annually (source). There are many stories of people who successfully run a passive laundromat business. Many like Laura from Laundromats101 (source) have shared their experiences about the industry and how you can make money passively from it (source). Although the business requires high capital to start and run, it offers a high ROI when well located, and can be started with little experience. This makes it a profitable business idea that can help you create a consistent passive income stream easily.
6. Vending Machines
Vending machines have to be some of the most passive sources of income. All you need is a vending machine, a good location, and to ensure that it’s always stocked. Back when I was young, vending machines used to stack 2 things: junk food or drinks. Today, there are vending machines for all types of products and services including food, drinks, fashion products, movies, electronics, consumer goods etc. You can earn passive income by vending the products your customers need. All you need is a vending machine, a niche product, and a high-traffic location to run a successful vending business. You also need to outsource the work required to stock and upkeep the machines to make it as passive as possible.
How much passive income can you make from a Vending Machine Business? Depending on the product/service you are selling, a well-run vending machine business can earn you over $100/weekly (souce). All you need is a good location and a niche product. If your business is located close to a school, for example, you can benefit from vending student material like stationery, candy & treats, drinks etc. The business may require high capital to start, but it offers good returns on invested capital making it a passive income source worth trying.
7. Game Machines (Arcade)
Did you enjoy playing arcade games? Although gaming arcades aren’t as popular as they used to be, they’re still a profitable way of earning money passively. Today, the arcade businesses have been forced to adapt to the changing gaming environment to remain profitable. For example, most arcades are located in places with other social amenities like restaurants, bars, malls etc. To create a profitable passive income stream, all you need is a good location and top-of-the-range games to attract an interested clientele base.
How much passive income can you make from a Game Arcade Business? It all depends on the kind of games you offer and the location of your business. A well-run game arcade business can earn up to $1,000 monthly (source). To earn more clients and make your business profitable, ensure you offer other services in your game arcade. You can have a food joint, bar, restaurant etc. to maintain your customer as they wait their turn on the machines. The initial costs of starting a gaming arcade may be huge, but the returns on investment are equally good. You have to consider factors like space, machines, equipment etc. that costs a lot of money (source).
8. Food Truck
This idea greatly resembles the ice cream truck business. The difference is that you’ll be selling food instead of ice cream to your customers. Unlike ice cream trucks, food truck business can help you rake in even more money passively. According to IBIS World, the food truck industry recorded over 6.8% growth in the last 5 years making it a viable way of earning money passively (source). There are many different types of food trucks on the market depending on what you intend to serve your customers. Of course, to make it more passive you would have to hire someone to stock, make and serve the food.
How much passive income can you make from a Food Truck Business? Depending on the type of food you sell, your location, and the size of your client base, your business can make you hundreds of dollars passively every day (source). The business requires a huge capital investment – considering a food truck costs approx. $15,000. But if it’s well-run and marketed, it offers high returns on investment within a short time. A successful food truck business can gross up to $300K in yearly revenues (source), making it a passive income business idea worth trying if you are passionate about mobile restoration.
9. Self Service Storage
Investing in self-storage facilities can be a profitable way of earning passive income. The best part? You earn lots of money without experiencing the headaches of tenants or broken toilets. Regardless of the economic situation, people will always require storage with 1 in every 10 Americans using self-storage facilities (source). Over 80% of the businesses in this $220 Billion industry are owned by “mom and pop” operators (source), which makes it a passive income idea worth trying.
How much passive income can you make from a Self-Service Storage Business? The success of your self-storage business depends on the size of your storage facility, it’s location, and the number of clients your serve. If well-run, the business can create a viable passive income stream and gross $300K-$700K every year (source).
How do I know the Ideal Passive Income Business Idea for me? There is no ‘ideal passive income idea.’ The passive income idea you choose depends on what you would like to do, what you are able to do, and what you can do depending on time, dedication, skill and capital.
Can you combine Passive Income Business Ideas? You can combine passive income ideas to create multiple streams of passive income. Implementing multiple ideas can generate more revenue, for example, placing vending machines in a laundromat would not only provide a better customer experience but also boost income.
If you have the capital to start and run two ideas together, why not. You make more income that is passive easily and over a long period.
What are some passive income business ideas? Some passive income business ideas include the following:
- Flipping Cars
- Self/Automatic Service Carwash
- Selling Ice Cream
- Vending Machines
- Arcade Game Machines
- Food Truck
- Self Service Storage
- Self-Service Store
How can I make $1,000 a month passive income? There are many ways to generate $1,000 passive income per month. For example, according to Income School’s Project 24, with 30,000 monthly page views, and following their 60-step blogging methodology, you can generate $1,000 per month passive income via ad placement.
How can I generate passive income? There are many ways to generate passive income. Some ways to generate passive income include via blogging, creating monetized YouTube content, affiliate marketing, niche membership sites, podcasting, chatbots and flipping domain names.